Great article from www.360FinancialLiteracy.org
It's hard to know when the economy will truly recover, although there are signs that things are headed in the right direction. But if you want your own finances to stabilize over the long term, you'll need to evaluate what you've been doing right, and wrong. There's no magic bullet, but avoiding these four money mistakes may help you survive and ultimately thrive in any turbulent economy.
Mistake 1: Expecting things to stay the same
It's a familiar tale. Economic times were good. The stock market went up, up, up. Home values (and real estate prices) soared, credit was flowing, and the job market was robust. And then the bottom fell out.
At the heart of all economic bubbles is the euphoric, yet ultimately mistaken, idea that the good times are here to stay. And when the economic news is bad, it's just as easy to assume that the tough times will remain. But your own financial recovery will ultimately depend on you not jumping on any bandwagon. Instead, take a proactive, rather than reactive, approach to financial planning, no matter what economic news you're hearing. Prepare yourself for a variety of financial scenarios and avoid basing money decisions on emotion, or you may find yourself making the same financial mistakes over and over.
Mistake 2: Only saving your leftovers
Do you worry that you're not saving enough? Do you routinely rely on credit rather than cash to pay for the things you want or need? Rather than blame your financial inertia on your income, look a bit deeper, because the real culprit may be the lack of financial priorities. If you don't know exactly how you're spending your money and you haven't set financial goals, it's unlikely that you'll see much financial progress.
Go back to basics by preparing (or reviewing) your budget. If you tend to save only what you have left over every month, you can put yourself on a more disciplined course by having a fixed amount taken out of your paycheck automatically for retirement. Or, you can set up automatic transfers from your checking account to a savings or investment account.
Mistake 3: Not having an emergency fund
One of your savings priorities should be an emergency fund. An emergency fund isn't glamorous, but this underappreciated work horse really pulls its weight during hard times. Having cash on hand that you can use for an unexpected expense, or to pay bills if you lose your job or become disabled, is vital because it can help you avoid having to rely on credit or tap your retirement savings. Without emergency savings to fall back on, worse financial trouble may lie down the road.
Mistake 4: Not asking for help
Even if your finances are in good shape right now, you may be overdue for a checkup. A close look at your financial plan will help you identify potential strengths and weaknesses. If you're already in financial trouble, don't let fear or shame prevent you from asking for help. Facing financial problems early may help you make a full recovery. Many creditors are willing to work with you, but this may be much easier while your credit is still good, and while you still have time to turn things around.
The 360 Degrees of Financial Literacy Web site offers general information for managing personal finances and does not recommend specific financial actions. For financial advice tailored to your situation, please contact an expert such as a CPA or a personal financial advisor
Friday, January 15, 2010
Thursday, January 14, 2010
Thrifty Thursday: Putting Savings in Perspective
Saving is hard. Especially for those of us who are prone to instant gratification. It is all too easy to spend that dollar on a delicious candy bar today and forgo the savings tomorrow. Below is a little article written by Spencer Sherman and Brent Kessel. The statements below really help put saving in perspective.
It is useful to keep in mind that the biggest determinant of financial success is your level of spending relative to your income and/or assets.
The reason is that you need about $20 saved in an investment portfolio for every $1 you're going to spend once you stop working and your earned income stops. So if you cut your spending by $1, you've actually just lowered your required savings by $20.
For example, if you can reduce your annual spending from $36,000 to $34,800 or by $1,200 ($100 per month), you've decreased your required savings by $24,000. Instead of needing a nest egg of $720,000 (twenty times $36,000), you only need $696,000 (twenty times $34,800).
How do you reduce spending by $100 per month?..... Keep reading Thrifty Thursdays! Every week we will be posting a savings tip that you can really use.
It is useful to keep in mind that the biggest determinant of financial success is your level of spending relative to your income and/or assets.
The reason is that you need about $20 saved in an investment portfolio for every $1 you're going to spend once you stop working and your earned income stops. So if you cut your spending by $1, you've actually just lowered your required savings by $20.
For example, if you can reduce your annual spending from $36,000 to $34,800 or by $1,200 ($100 per month), you've decreased your required savings by $24,000. Instead of needing a nest egg of $720,000 (twenty times $36,000), you only need $696,000 (twenty times $34,800).
How do you reduce spending by $100 per month?..... Keep reading Thrifty Thursdays! Every week we will be posting a savings tip that you can really use.
Wednesday, January 13, 2010
Getting Organized in the New Year can Save You Cash!
If you are a really unorganized, slightly messy pack rat getting organized could not only save you money but make some!
1) Organizing a shopping list to take to the grocery cuts down on expensive impulse buys.
2) Keep a shopping list in your kitchen. Write down what you need as you get low on things. Same benefit as #1
3) Organizing your checkbook or online banking might enable you to see how much money you waste on ATM fees so you can make changes to avoid that.
4) Organization in general, cuts down on repetition. This might mean keeping cabinets and medicine chests organized so you don’t buy items you don’t need.
5) Organize all of your DVDs, books, and video games and any you no longer want you can sell to half priced books, on Amazon, eBay, or craigslist.
6) Getting your space organized can save you money by finding long lost items like phone chargers, batteries, screwdriver, light bulbs.
7) Organizing your closet can help you find old clothing to mix and match into your newer clothes.
8) Scan old photos onto the computer. It saves spaces and gives you a task to do instead of going out and spending money. (Could also be a great gift idea for family and friends that is inexpensive).
9) Keep a space in your home where you put things you want to donate. A large plastic storage box is a good idea. When it is full, make a list and donate. You will get a tax deduction is your itemize.
10) Budgeting is a way of organizing and it saves money because you make conscious choices about your money before you make or spend it
11) Organizing your pantry makes it easier to cook at home, saves money, and less chance you will buy something you don’t need
12) Living an organized life gives you more time, and you can either 1) enjoy more leisure or 2) take up a hobby that produces income
1) Organizing a shopping list to take to the grocery cuts down on expensive impulse buys.
2) Keep a shopping list in your kitchen. Write down what you need as you get low on things. Same benefit as #1
3) Organizing your checkbook or online banking might enable you to see how much money you waste on ATM fees so you can make changes to avoid that.
4) Organization in general, cuts down on repetition. This might mean keeping cabinets and medicine chests organized so you don’t buy items you don’t need.
5) Organize all of your DVDs, books, and video games and any you no longer want you can sell to half priced books, on Amazon, eBay, or craigslist.
6) Getting your space organized can save you money by finding long lost items like phone chargers, batteries, screwdriver, light bulbs.
7) Organizing your closet can help you find old clothing to mix and match into your newer clothes.
8) Scan old photos onto the computer. It saves spaces and gives you a task to do instead of going out and spending money. (Could also be a great gift idea for family and friends that is inexpensive).
9) Keep a space in your home where you put things you want to donate. A large plastic storage box is a good idea. When it is full, make a list and donate. You will get a tax deduction is your itemize.
10) Budgeting is a way of organizing and it saves money because you make conscious choices about your money before you make or spend it
11) Organizing your pantry makes it easier to cook at home, saves money, and less chance you will buy something you don’t need
12) Living an organized life gives you more time, and you can either 1) enjoy more leisure or 2) take up a hobby that produces income
Thursday, January 7, 2010
THRIFTY THURSDAYS: 15 Ways to Save while Staying Fit
1.Are you a loner or do you need the impact of a friend/team? Some of us are great at setting goals and just doing it. Others need to get a buddy to be accountable to. What is your nature? Design you system around this first.
2. Swap Workout VHS/DVDs with friends. Almost everyone has a workout tape sitting at home. Get a group of friends together to swap tapes weekly to keep your workouts interesting and your body guessing.
3. Gather a group of friends. Go to the park and play flag football, soccer, basketball, tennis or even a high energy game of freeze tag.
4. Share a Wii Fit with friends. So many people have Wii Fits now, get a group together for a weekly Wii yoga session.
5. Have a Dog? Get in shape with your favorite furry friend! They need to stay strong and fit too. Throw around the frisbee, run around the dog park or take walks in the park. If you don't have a dog ask to borrow your neighbors. They will thank you for it!
6. Learn to use your body as your strength training weights, there is no need for expensive equipment. And there are lots of video resources on youtube.
7. Walk or run your way to health. All you need is a good pair of running shoes.
8. Walk at lunch. During the winter, it is often too cold or dark to walk in the morning or evening, so go into work early and then walk at lunch when the sun is out and more palatable.
9. Buy used equipment on Craig's list, eBay, or other online merchant. Often people think they will like a certain kind of workout, but really don't.
10. Shop around for a fitness club. What is most important to you? A pool? A basketball court? A sauna? Many clubs give you 30 days free or a certain amount of free visits. Try them out in the winter. Assess you budget, if your purse strings can hold out go for it. If not, once the winter breaks go back to your walking shoes.
11. Go to the mall in bad weather. Its warm and free, but be careful of the window displays!
12. Take the stairs at work and try to make it a challenge with your co-workers. Who can take the stairs the most times in a day/week/month?
13. Ask friends if they have old workout equipment lying around you could borrow, swap, or trade for. Get fun and creative with the payoff, like I get your treadmill and in return I will cook you dinner once a week for 6 weeks.
14. Some of us need that extra boost of a personal trainer to keep us motivated. To cut down on the cost see if your personal trainer will train you and a few friends. This way you could split the cost in half or even thirds!
15. Go dancing! Its a great way to meet people, stay in shape and have fun. Check craigslist or a local event site to check out the different venues and types of dances there are in your area.
by: Gracie Mohr
2. Swap Workout VHS/DVDs with friends. Almost everyone has a workout tape sitting at home. Get a group of friends together to swap tapes weekly to keep your workouts interesting and your body guessing.
3. Gather a group of friends. Go to the park and play flag football, soccer, basketball, tennis or even a high energy game of freeze tag.
4. Share a Wii Fit with friends. So many people have Wii Fits now, get a group together for a weekly Wii yoga session.
5. Have a Dog? Get in shape with your favorite furry friend! They need to stay strong and fit too. Throw around the frisbee, run around the dog park or take walks in the park. If you don't have a dog ask to borrow your neighbors. They will thank you for it!
6. Learn to use your body as your strength training weights, there is no need for expensive equipment. And there are lots of video resources on youtube.
7. Walk or run your way to health. All you need is a good pair of running shoes.
8. Walk at lunch. During the winter, it is often too cold or dark to walk in the morning or evening, so go into work early and then walk at lunch when the sun is out and more palatable.
9. Buy used equipment on Craig's list, eBay, or other online merchant. Often people think they will like a certain kind of workout, but really don't.
10. Shop around for a fitness club. What is most important to you? A pool? A basketball court? A sauna? Many clubs give you 30 days free or a certain amount of free visits. Try them out in the winter. Assess you budget, if your purse strings can hold out go for it. If not, once the winter breaks go back to your walking shoes.
11. Go to the mall in bad weather. Its warm and free, but be careful of the window displays!
12. Take the stairs at work and try to make it a challenge with your co-workers. Who can take the stairs the most times in a day/week/month?
13. Ask friends if they have old workout equipment lying around you could borrow, swap, or trade for. Get fun and creative with the payoff, like I get your treadmill and in return I will cook you dinner once a week for 6 weeks.
14. Some of us need that extra boost of a personal trainer to keep us motivated. To cut down on the cost see if your personal trainer will train you and a few friends. This way you could split the cost in half or even thirds!
15. Go dancing! Its a great way to meet people, stay in shape and have fun. Check craigslist or a local event site to check out the different venues and types of dances there are in your area.
by: Gracie Mohr
Thursday, December 31, 2009
Make the New Year Prosperous
Start by reviewing your 2009 income and expenses. Tools you can use include Mint.com, Quicken® or a simple spreadsheet. Go through your bank and credit card statements and categorize your sources of income and expense. Expense categories include things like mortgage, utilities, dining out, groceries, health care, beauty care, etc. Separate your expenses into needs and wants. Take a big picture look at your 2009 habits from this perspective. What do you see?
Next set your 2010 goals. Do you want to go on a summer vacation? Buy a new refrigerator? Pay for your grandchild’s private school? What is really important to you as your prioritize your money?
Prepare a budget for 2010. Start with your needs and add in your goals for 2010. If your expenses exceed your income first look for ways to eliminate unnecessary spending, like brown bagging your lunch instead of eating out. Next look for ways to reduce spending, for example, having your hair cut every six weeks instead of every four. Look at behaviors or habits that cause you to spend money. Do you consider shopping recreation? If so replace that habit with another such as a walk in the park, visit to the local library, game night with your friends.
Many people fail to build an emergency fund. We all need at least 90 days of spending stashed away in a savings or money market account for those unexpected rainy days. If you aren’t there yet, be sure your 2010 budget includes a line item for building your safety net.
Budgeting is essential to take charge of your financial life. If you budget, you are choosing what you want. You are rowing your own boat in the direction you want to go. If you failed to budget, you are leaving your goals to chance, going wherever the river will take you. You may get what you want and you may not. Empowered people budget and plan. Join the budget crew today and create the life you want.
As you plan, remember to think past 2010. A solid financial future is built by saving and increasing your net worth. Review your 401(k) or other employer plan and be sure you are participating at least a level to get the full match. If your budget allows, contribute more. Pay down your credit cards, starting with the smallest one first. Celebrate your victory (without using your credit card) and proceed to the card with the highest interest. Prepare a quarterly net worth statement and give yourself regular at a boy/girls for growing your wealth!
May prosperity be yours,
Mackey McNeill, CPA/PFS
President and CEO, Mackey Advisors
www.CultivatingProsperity.com
Mackey@CultivatingProsperity.com
Next set your 2010 goals. Do you want to go on a summer vacation? Buy a new refrigerator? Pay for your grandchild’s private school? What is really important to you as your prioritize your money?
Prepare a budget for 2010. Start with your needs and add in your goals for 2010. If your expenses exceed your income first look for ways to eliminate unnecessary spending, like brown bagging your lunch instead of eating out. Next look for ways to reduce spending, for example, having your hair cut every six weeks instead of every four. Look at behaviors or habits that cause you to spend money. Do you consider shopping recreation? If so replace that habit with another such as a walk in the park, visit to the local library, game night with your friends.
Many people fail to build an emergency fund. We all need at least 90 days of spending stashed away in a savings or money market account for those unexpected rainy days. If you aren’t there yet, be sure your 2010 budget includes a line item for building your safety net.
Budgeting is essential to take charge of your financial life. If you budget, you are choosing what you want. You are rowing your own boat in the direction you want to go. If you failed to budget, you are leaving your goals to chance, going wherever the river will take you. You may get what you want and you may not. Empowered people budget and plan. Join the budget crew today and create the life you want.
As you plan, remember to think past 2010. A solid financial future is built by saving and increasing your net worth. Review your 401(k) or other employer plan and be sure you are participating at least a level to get the full match. If your budget allows, contribute more. Pay down your credit cards, starting with the smallest one first. Celebrate your victory (without using your credit card) and proceed to the card with the highest interest. Prepare a quarterly net worth statement and give yourself regular at a boy/girls for growing your wealth!
May prosperity be yours,
Mackey McNeill, CPA/PFS
President and CEO, Mackey Advisors
www.CultivatingProsperity.com
Mackey@CultivatingProsperity.com
Wednesday, December 30, 2009
COBRA Premium Subsidy Program Extended
On December 19, 2009, President Obama signed into law the Department of Defense Appropriations Act, 2010 (DOD) which extends the 65% COBRA premium subsidy to February 28, 2010.
The American Recovery and Reinvestment Act of 2009 provided a government subsidy of 65% of the cost of COBRA coverage for employees (and their eligible family members) who lost their health insurance coverage due to involuntary termination of employment in 2009. The subsidy was to last for up to 9 months. The DOD extends the subsidy to 15 months and includes eligible employees (and their eligible family members) who lose their jobs in January or February of 2010.
The American Recovery and Reinvestment Act of 2009 provided a government subsidy of 65% of the cost of COBRA coverage for employees (and their eligible family members) who lost their health insurance coverage due to involuntary termination of employment in 2009. The subsidy was to last for up to 9 months. The DOD extends the subsidy to 15 months and includes eligible employees (and their eligible family members) who lose their jobs in January or February of 2010.
Monday, December 28, 2009
How to Stay Fit on a Budget
by: Sheryl Nance-Nash
The Faster Times
December 24, 2009
If you’re like many people, you vow to get in shape around this time every year- and find a way to break the vow somewhere between the Rose Bowl and Valentine’s Day. Well, make your own excuses. But after reading this, you’ll have to let go of the idea that working out is too expensive. Working out should shrink your waistline, not your wallet. Here’s how to do it on the cheap.
Cash in on broken promises
Idle workout equipment needn’t remind you of broken promises: it can look like a fresh start. If you have a bench or LifeCycle in your basement, treat it as a free starter kit: if you need to buy one, scoop somebody else’s discarded treadmill or rower on Craigslist or eBay. “If you make smart purchases, a basic home gym can be set up for under $100 and allow you to perform dozens of exercises,” says Brad Schoenfeld, author, Women’s Home Workout Bible.
Go for the video. For even lower expenses, buy about $60 worth of exercise DVDs- or pay nothing to borrow them from the library. “Get a group of friends together to swap tapes weekly to keep it interesting and your body guessing,” says Mackey McNeill, president of Mackey Advisors CPA’s & Wealth Advisors. You can use a video console to work out with friends. EA Sports Active is a $60 customizable, fitness video game created for the Wii that claims to get your heart pumping in just 20 minutes a day.
If you want to expend some shoe leather, you can probably find a free gym or track in your town- at the high school, perhaps, or in an apartment complex that hasn’t sold out its units. “Ask around town,” says Jenny Realo, executive vice president of CareOne Services, a debt relief services provider. You may also find walking or running groups. “Your chances of success are higher if you have someone keeping check on your workout goals,” adds Realo.
If you have your heart set on joining a gym, now is a good time to look for a membership as there are deals waiting on all those who are making the same resolution to get in shape. You can cut the cost of a personal trainer by sharing one. Ask around at clubs that offer personal training if they have small group arrangements. Be smart. Shop around. Don’t be afraid to negotiate. Gyms need members in a recession, as sorely as you need discipline.
Run baby run. Of course, exercise can be free. For little more than the price of running shoes you can run just about anywhere. If winter weather is an issue, you can always do brisk walks in a mall if you do so at hours where there isn’t likely to be a crowd. Just don’t stop to shop!
Find places to add extra walking time, whether it be the distance you park your car at the grocery store or the daily commute to work. “It can also be as easy as adding 10 to 15 minutes extra to the daily walk you have with your pet. A 30-minute walk can shed up to 200 calories,” says Realo.
Take the stairs at work and make it a challenge with your co-workers. “Who can take the stairs the most times in a week or a month?” says McNeill.
That’s right: fitness happens, in 2010, one step at a time. Good luck!
The Faster Times
December 24, 2009
If you’re like many people, you vow to get in shape around this time every year- and find a way to break the vow somewhere between the Rose Bowl and Valentine’s Day. Well, make your own excuses. But after reading this, you’ll have to let go of the idea that working out is too expensive. Working out should shrink your waistline, not your wallet. Here’s how to do it on the cheap.
Cash in on broken promises
Idle workout equipment needn’t remind you of broken promises: it can look like a fresh start. If you have a bench or LifeCycle in your basement, treat it as a free starter kit: if you need to buy one, scoop somebody else’s discarded treadmill or rower on Craigslist or eBay. “If you make smart purchases, a basic home gym can be set up for under $100 and allow you to perform dozens of exercises,” says Brad Schoenfeld, author, Women’s Home Workout Bible.
Go for the video. For even lower expenses, buy about $60 worth of exercise DVDs- or pay nothing to borrow them from the library. “Get a group of friends together to swap tapes weekly to keep it interesting and your body guessing,” says Mackey McNeill, president of Mackey Advisors CPA’s & Wealth Advisors. You can use a video console to work out with friends. EA Sports Active is a $60 customizable, fitness video game created for the Wii that claims to get your heart pumping in just 20 minutes a day.
If you want to expend some shoe leather, you can probably find a free gym or track in your town- at the high school, perhaps, or in an apartment complex that hasn’t sold out its units. “Ask around town,” says Jenny Realo, executive vice president of CareOne Services, a debt relief services provider. You may also find walking or running groups. “Your chances of success are higher if you have someone keeping check on your workout goals,” adds Realo.
If you have your heart set on joining a gym, now is a good time to look for a membership as there are deals waiting on all those who are making the same resolution to get in shape. You can cut the cost of a personal trainer by sharing one. Ask around at clubs that offer personal training if they have small group arrangements. Be smart. Shop around. Don’t be afraid to negotiate. Gyms need members in a recession, as sorely as you need discipline.
Run baby run. Of course, exercise can be free. For little more than the price of running shoes you can run just about anywhere. If winter weather is an issue, you can always do brisk walks in a mall if you do so at hours where there isn’t likely to be a crowd. Just don’t stop to shop!
Find places to add extra walking time, whether it be the distance you park your car at the grocery store or the daily commute to work. “It can also be as easy as adding 10 to 15 minutes extra to the daily walk you have with your pet. A 30-minute walk can shed up to 200 calories,” says Realo.
Take the stairs at work and make it a challenge with your co-workers. “Who can take the stairs the most times in a week or a month?” says McNeill.
That’s right: fitness happens, in 2010, one step at a time. Good luck!
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